B-130659, JUL. 10, 1957

B-130659, JUL. 10, 1957

TO CLEMENTS FOOD PRODUCTS COMPANY:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 10, 1957, WITH ENCLOSURES, REQUESTING RECONSIDERATION OF DECISION DATED MARCH 26, 1957, TO THE SECRETARY OF THE ARMY, WHEREIN IT WAS HELD THAT THERE WAS NO LEGAL BASIS FOR THE PAYMENT OF $621.04, REPRESENTING AN ADDITIONAL AMOUNT CLAIMED BY YOU TO BE DUE UNDER CONTRACT NO. DA-41-189-QM-4995 (O.I. FTW 2673-57) AND UNNUMBERED CONTRACT PURCHASE ORDER NO. O.I. FTW 2723 57.

THE FACTS IN THE MATTER ARE SET FORTH IN THE DECISION OF MARCH 26, 1957, COPY HEREWITH, AND THEREFORE WILL BE REFERRED TO ONLY BRIEFLY. RESPONSE TO TWO NOTICES OF INTENT TO PURCHASE YOU SUBMITTED WRITTEN QUOTATIONS, F.O.B. ORIGIN, ON SEVERAL ITEMS OF PRESERVES IN NO. 10 CANS (6 PER CASE). YOUR BID ON FOUR ITEMS UNDER NIP CHI-291-57 AND ONE ITEM UNDER NIP CHI-331-57, WERE THE LOWEST RECEIVED AND THE BIDS WERE ACCEPTED BY THE FORT WORTH QUARTERMASTER MARKET CENTER BY LETTERS OF SEPTEMBER 24 AND SEPTEMBER 26, 1956, RESPECTIVELY.

ON OCTOBER 9, 1956, AFTER RECEIPT OF THE NOTICES OF AWARD AND AFTER RECEIPT OF THE FORMAL CONTRACT DOCUMENTS, BUT PRIOR TO THEIR EXECUTION AND RETURN, A REPRESENTATIVE OF YOUR COMPANY ADVISED THE FORT WORTH QUARTERMASTER CENTER THAT YOU HAD MADE A MISTAKE IN YOUR BID AND REQUESTED PERMISSION TO WITHDRAW THE BIDS. YOU WERE ADVISED THAT THE QUOTATIONS COULD NOT THEN BE WITHDRAWN AS THE AWARD HAD BEEN MADE WITHOUT KNOWLEDGE OF ERROR, BUT THAT IF YOU DESIRED YOU COULD SUBMIT A CLAIM TOGETHER WITH AN EXPLANATION OF THE ERROR AND IT WOULD BE CONSIDERED.

AS STATED IN THE DECISION THE PRIMARY QUESTION INVOLVED IS NOT WHETHER AN ERROR WAS MADE IN THE QUOTATIONS, BUT WHETHER VALID AND BINDING CONTRACTS WERE CONSUMMATED BY THE LETTERS OF ACCEPTANCE DATED SEPTEMBER 24 AND 26, 1956. IT IS A WELL ESTABLISHED RULE OF LAW THAT WHERE A BIDDER HAS MADE A MISTAKE IN THE SUBMISSION OF A BID AND THE BID HAS BEEN ACCEPTED HE MUST BEAR THE CONSEQUENCES THEREOF, UNLESS THE MISTAKE WAS MUTUAL OR THE ERROR WAS SO APPARENT THAT IT MUST BE PRESUMED THAT THE CONTRACTING OFFICER KNEW OF THE MISTAKE AND SOUGHT TO TAKE ADVANTAGE OF IT. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249, 259 AND SALIGMAN ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507.

AS WAS POINTED OUT IN THE DECISION OF MARCH 26, WHILE YOUR QUOTATIONS WERE LOW ON FOUR ITEMS UNDER ONE INVITATION AND ONE ITEM UNDER THE OTHER, THEY WERE NOT SO LOW AS WOULD JUSTIFY CHARGING THE CONTRACTING OFFICER WITH CONSTRUCTIVE NOTICE OF THE POSSIBILITY OF ERROR. IN FACT, HAD THE ALLEGED MISTAKE NOT BEEN MADE YOU WOULD NOT HAVE BEEN LOW ON ANY OF THE FIVE ITEMS INVOLVED, AND EVEN WITH THE MISTAKE YOU WERE NOT LOW ON ITEMS NOS. 21 AND 23 OF NIF CHI-291-57. THUS, IT MUST BE CONSIDERED THAT YOUR QUOTATIONS WERE ACCEPTED IN GOOD FAITH WITHOUT NOTICE OF ERROR AND THAT THE LETTERS OF ACCEPTANCE DATED SEPTEMBER 24 AND 26, 1956, CONSUMMATED VALID AND BINDING CONTRACTS WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES THERETO.

THE LAW IS CLEAR THAT ONCE A CONTRACTUAL, OR OTHER RIGHT, HAS BECOME VESTED IN THE UNITED STATES, AS IN THIS CASE, THERE EXISTS NO AUTHORITY IN ANY OF ITS OFFICERS OR AGENTS TO GRATUITOUSLY WAIVE OR SURRENDER THE SAME. SEE UNITED STATES. V. AMERICAN SALES COMPANY, 27 F.2D 299, AFFIRMED 32 F.2D 141; AND SIMPSON V. UNITED STATES, 172 U.S. 372.

ACCORDINGLY, YOU ARE ADVISED THAT THERE IS NO BASIS FOR MODIFICATION OF THE CONCLUSION REACHED IN THE DECISION OF MARCH 26, 1957.